Former minister says Bajans can’t afford pension plans outside NIS

By Jenique Belgrave

Most Barbadians are struggling and cannot afford to put funds in other retirement arrangements beyond the National Insurance Scheme’s (NIS) pension plan.

This is the position of former Minister of Commerce Lynette Eastmond as she knocked suggestions that Barbadians should diversify their retirement income in light of the Government’s pension reform proposals.

Stressing that was not within the pockets of the majority of Barbadian workers, she said that several people who had attempted that had ended up losing their investment.

“I have heard persons saying that individuals need to diversify out of the (NIS) Fund. Barbadians aren’t clowns; many of them have tried to diversify. They’ve diversified into treasury bills, bonds, and CLICO, and these didn’t work out. The majority of Barbadians cannot afford to invest money in other areas. Most Barbadians live from pay cheque to pay cheque. Do not mind all the new cars you see on the road…. Barbadians are struggling,” she told Barbados TODAY.

Eastmond called for transparency regarding any investment of NIS funds going forward, insisting that the NIS must not be used to support private sector projects in need.

“The Fund isn’t there for that. The Fund is not the Enterprise Growth Fund, the Fund is not Fund Access, and it should not be used for risky private sector projects simply because they need public sector support,” she said, as she pointed out that no responsibility had been taken for the almost $10 million the NIS had invested in the stalled Four Seasons project .

“I know the NIS invested in other private-sector projects, and I don’t know what the position is with respect to those others, but I know that Four Seasons is certainly a scandal because we know money went in, and we know that individuals were paid professional fees, but we don’t know what happened after that, and there’s no accountability.”

Eastmond also questioned the plan to transform the NIS into a state-owned commercial enterprise.

“Our experience is that these entities fall victim to political influence, so instead of there being continuity, the government changes, the whole board changes. The individuals on the boards are handpicked and, therefore, quite often in many of these situations, they feel obliged to follow the instructions of political operatives. That’s the difficulty. We should be moving towards less political interference and having people lead institutions because of their ability to lead them,” she said.

“So my concern is about the privatisation of the NIS Fund because I believe that there will be less oversight as the decisions are not going to go through the process of going through the Cabinet and Parliament.”

The attorney-at-law expressed concern about the lack of public consultation regarding the Government’s plan to raise the pensionable age to 68 in 2034 and to increase the number of contributions for pension eligibility from 500 to 750.

She said that additional town hall meetings, advertisements and public service announcements would have ensured that more Barbadians were educated on the Government’s plans for pension reform.

“I believe that it was woefully inadequate. There are certain institutions who are now only consulting with their members after the bill has passed in the Lower House. Now I have fundamental issues with how we operate as a democracy. The people are left out of the process…. My second concern has to do with the fact that when they agreed upon a bill, the bill was not circulated to the people – another example of complete disregard and disrespect for people in Barbados,” Eastmond stressed.

Noting that the pensionable age has already been moved several times in the past, she said the Government, in its current proposal, did not seek to put an end to this “creeping increase” and could therefore raise it again at any time.

jeniquebelgrave@barbadostoday.bb